NHN was accused of ignoring a request to stop users from sharing
music files.

"Our suit is not designed to seek financial damages but to ring
an alarm bell for illegal music swappers," Nofree's legal advisor
Kim Young-ki said.

The industry blamed internet piracy for causing more than 400
billion won ($A511 million) of annual losses.

Sales in South Korea's music market tumbled won 180 billion won
in 2003 from 600 billion won seven years before.

But the market rebounded last year, helped by legal and
institutional changes that boosted legitimate online music
services, with sales rising to 240 billion won.

After a year-long debate, an appeals court ruled in January
ordered Soribada, the country's pioneering music swapping site, to
shut down the first version of its file-sharing software and
computer servers.

It marked South Korea's first legal action against a P2P
(peer-to-peer) program that allows users to access computer files
directly from each other's hard disk drives.

Piracy, however, is still widespread in South Korea, one of the
world's most concentrated markets for high-speed internet
connections that make it possible to download a full-length movie
or music quickly.

Users feature music files on their blogs, allowing visitors to
listen to those songs online.

A US survey in 2004 found that 58 per cent of South Korean
internet users have illegally downloaded movies.